1. Proposal to Implement a National Social Health Insurance Scheme in Zambia Collins Chansa-MOH Henry Kansembe-MoH Michael Kachumi-CHAZ David Chilombo-PIA Anthony Dumingu-MoLSS Caroline Yeta-PRA

2. Introduction Population: 12.2 (2007 proj.) Under -5 mortality rate: 119 per 1,000 live births Infant mortality rate 70 per 1,000 live births Maternal Mortality: 591 per 100,000 Poverty incidence; 64 percent Extreme poverty; 46% Gini-coefficient; 0.57

4. Financing Sources (I) As a % of the total GRZ Discretionary Budget, the health sector currently receives 11.5% The major sources of funding for Public health services are GRZ (45%), Donors (55%) though SWAp, Direct Sector Support, Projects As a % of Total Health Exp. GRZ 25%, Households 27%, Donors 42%, Employers 5%, Others 1% As a % of GDP, Total Health Exp. Represents - 6.3% which translate to approximately USD$ 58 per capita (NHA 2006 )

5. Financing Sources (II) Other sources include User fees which until the scrapping in rural areas represented about 4%. User fees still remain an important source of financing for major hospitals like the UTH. Medical levy (1% tax on interest earnings) which contributes about K8 billion annually.

6. NHSP Financing Gap 2009-2010

7. Justification for SHI SHI is likely to be a more equitable health care financing mechanism than the current existing health care financing sources Insurance schemes would subsidize services to the poor and vulnerable General & disease-specific Household Exp. on health still very high. SHI will tap into this SHI will play a complementary role in providing funding to the health sector and assist GRZ in meeting the Abuja Declaration of 15%

8. What we have done so far Comprehensive studies (from 1992 to 2008) looking at: Resource flows in Zambia's Health system (NHA) Health Facilities Census detailing available health facilities and equipment in Zambia Six (6) joint appraisals of Zambias health reforms Four (4) Demographic and Health Surveys showing population characteristics & common diseases Costing of NHSP and BHCP Two (2) studies profiling Catastrophic Health Expenditures (University of Cape Town & UNZA, 2008) One (1) study on Policy Options for Health Care Financing

9. What we have done so far... Detailed Actuarial Study (2008) Looking at: The population to be covered to make the scheme viable Break-even point Premium rate that will cater for the benefit package envisaged The benefit package The rate of administrative expenses Eligibility conditions to benefits Projection of investments and reserves

10. Description of the Proposed National SHI in Zambia The national SHI fund shall be established by an Act of Parliament. The fund shall be administered by an autonomous institution/body Scheme will be feasible when the contribution rate is at 5% of the Insured Persons salary. The contribution rate will be shared by Employer & Employee (evenly or otherwise) The scheme is expected to invest in safe opportunities such as treasury bills, fixed deposits and treasury bonds

11. Description of the Proposed National SHI in Zambia The scheme will initially cover the formal sector employees (public and private) who are estimated to be 495,277 in 2009 and projected at 739,337 in 2023 This includes (i) Central Government (ii) Local Government (iii) Parastatal Organizations, and (iv) Private-sector Employees The number of beneficiaries per single contributor will 6 (principle member, spouse & four children/dependants) From the above, the total population covered initially will be 2,971,662 (22%) and increase to 4,436,024 (35%) by 2023 At a later stage, it will be vital to expand the scheme to the informal sector

12. Funding Sources & Cash Outflows

13. Next Steps…. Political process: mobilize support from donors Civil society, FBOs, private employers Use actuarial model (Cabinet Office still studying report) to guide decision making including conducting more sensitivity analysis Preparation of Policy documents and legislature on SHI Documentation and Logistics Marketing Strategy

14. Re-investment, fund holder & institutional arrangements Political Pressure, trade unions, co- payments by employers Quality of health care services e.g. drugs Extension of Coverage to informal sector & in rural areas Information Communication & Technology No User Fees, Community health Insurance. What will motivate people to contribute? 14 Anticipated Challenges

15. I Thank You END of Presentation